Wang v. Leo Chuliya, LTD

Background

Bin Wang and Yan Qiu Zhang sued Leo Chuliya, Ltd., doing business as Fantasy Cuisine Co.; Dumpling Plus Corp., doing business as Dumpling + Noodle; Austin Chu; and Jane Chen. They alleged violations of the Fair Labor Standards Act (FLSA), the federal wage law, and the New York Labor Law (NYLL), including claims for unpaid overtime. The defendants moved for summary judgment, which asks the court to rule without a trial when no genuine dispute over an important fact requires a jury’s decision.

Fantasy Cuisine operated a dim sum department and a stir-fry department. Zhang worked in the dim sum department from October 2015 to March 2020, and Wang worked there from September 2019 to October 2020. The parties disputed whether Zhang managed the department and supervised Wang, whether the plaintiffs prepared food for Dumpling Plus, and whether the two businesses operated as a single employer or otherwise jointly employed the plaintiffs.

Evidentiary objections

The defendants asked the court to disregard declarations from Wang and Zhang because some statements allegedly contradicted their deposition testimony. The court found no direct contradictions requiring the declarations to be entirely disregarded. It considered the declarations only to the extent they supplemented the deposition testimony, addressed matters not fully explored during the depositions, or were supported by other evidence.

Jane Chen’s employer status

The court granted summary judgment as to Jane Chen and dismissed her from the action. Under the FLSA and NYLL, an employer must have sufficient control over the workers or their employment. The court found that the evidence did not show that Chen had the power to hire or fire the plaintiffs, supervised their schedules or working conditions, set their pay, or maintained employment records. Her ownership interest and the description of her as the “Lady Boss” were not enough to establish employer status. The court also declined to consider whether she functionally controlled the plaintiffs because the defendants and plaintiffs had not addressed that theory.

Dumpling Plus’s employer status

The court denied summary judgment on whether Dumpling Plus was an employer under the FLSA and NYLL. The evidence showed that Dumpling Plus had its own managers, staff, kitchen, and equipment, and that the plaintiffs did not work at its premises. But Zhang testified that the dim sum department supplied food to both locations, food was regularly delivered to Dumpling Plus, her pay increase was connected to work for both businesses, and the businesses had similar menus. Chu owned both businesses and controlled labor-related matters at both establishments.

Viewing the evidence in the plaintiffs’ favor, the court found a genuine dispute over whether Fantasy Cuisine and Dumpling Plus were a single integrated enterprise. The court also concluded that the same evidence could support a finding that Dumpling Plus functionally controlled the plaintiffs as a joint employer. Those factual questions therefore had to be resolved at trial.

Zhang’s executive exemption

The defendants argued that Zhang was exempt from overtime requirements as an employee working in a bona fide executive capacity. That exemption requires, among other things, that the employee’s primary duty be management, that the employee regularly direct at least two other employees, and that the employee have hiring or firing authority or recommendations given particular weight.

The court denied summary judgment on this issue. The parties disputed whether Zhang’s primary duty was managing the dim sum department or preparing food as a chef. Zhang testified that she spent most of her time cooking and working alongside other employees. That evidence created a material factual dispute that a jury would need to resolve.

Wang’s creative-professional exemption

The defendants argued that Wang was exempt from overtime as a creative professional. This exemption can apply to a chef whose primary duty requires invention, imagination, originality, or talent, such as regularly creating or designing unique dishes or menu items. The court recognized that the exemption must be evaluated based on the employee’s actual duties, not job title.

The court declined to grant summary judgment on this issue. The parties disputed the skill involved in preparing dim sum and whether Fantasy Cuisine was a gourmet establishment. The record did not establish as a matter of law that Wang’s primary duty involved creating or designing unique dishes and menu items. These issues therefore remained for trial.

Disposition

The opinion’s opening states that the defendants’ summary-judgment motion was granted in part and denied in part. The court dismissed Jane Chen as a defendant and directed the case to proceed to trial on whether Dumpling Plus was liable as an employer, whether Zhang was exempt under the executive exemption, and whether Wang was exempt under the creative-professional exemption. The court also directed the parties to submit a joint pretrial order within three weeks.

The conclusion refers to “Plaintiffs’ summary judgment motion,” but the opinion states elsewhere that Defendants filed the motion and describes the rulings as resolving Defendants’ motion. This appears to be a clerical error in the conclusion.